Detailed report into business continuity practices in the UK food and drink sector published

An independent report by Cranfield University on business continuity management in the food and drink industry has been published. The study was commissioned by Defra to strengthen the evidence base for government policy and to encourage business continuity planning in the sector.

The report concludes that the drive for efficiency and the just-in-time philosophy has progressively reduced stock levels throughout the supply chain with consequences for its resilience. The security of the supply chain as a whole is therefore more dependent on the availability of a range of sources and supply routes.

Robust and resilient business continuity plans provide food and drink retailers with the measures needed to deal with any threat of disruption.

The report also sums up the current state of business continuity management in the food and drink sector, finding that:

* Business continuity is recognised as a rising discipline and is a growing concern.

* Business continuity management is still in the early stages of implementation.

* All organisations surveyed for the report had some form of IT-related continuity planning/disaster recovery in place but most admitted that they weren’t ‘in the vanguard’ of BCM practices.

* Most companies surveyed are pursuing wider operational risk management programmes, for reasons of compliance.

* Risk management processes established for corporate governance, food safety or health and safety purposes formed the basis of business continuity activities in most companies.

* Few of the companies surveyed had moved beyond reactive crisis management to proactive or preventative business continuity management.

* Resource constraints (money and manpower) and lack of expertise are slowing BCM implementation.

* Larger retailers are inherently resilient because few of their assets are mission critical. Their networks can withstand the loss of any store and any product supplier without significant disruption to operations. Their distribution centres, head offices and service suppliers are more likely to create single or significant points of failure. However, the retailers’ principal asset and concern is their brand reputation.

* Most organisations surveyed are doing business continuity management out of ‘enlightened commercial self-interest’. They see the purpose of BCM being to protect the well-being of customers, employees and shareholders. It is not being undertaken for the ‘public good’ or to maintain operations in times of national emergency.

Read the full report (Word document)

•Date: 2nd March 2007 • Region: UK •Type: Article •Topic: Retail sector
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